Recall that in the days leading to the Brexit vote, one of the most closely followed indicators of public sentiment was online bookmaker betting, where in a curious split, the majority of smaller wages was for Brexit, however the total amount betted was skewed by a handful of outsized bets on “remain.” However, when it comes to Trump, there appears to be less confusion – or interference – at least in the last several days.
According to a recent Paddy Power tweet, on Monday and Tuesday the Republican candidate outshone his rival in terms of both the number and the volume of wagers, as just shy of 100,000 euros ($111,000) in bets came in, with 91 percent of that for Trump.
In the past 48 hours, 91% of bets on the US Election have been on Trump. He’s into 9/4. And we’ve already paid out on Hillary. Uh-oh. pic.twitter.com/pGEkHMbrF2
— Paddy Power Politics (@pppolitics) November 1, 2016
Cited by Bloomberg, Féilim Mac An Iomaire, a spokesman for the company, confirmed the report saying that “this election’s been a serious betting anomaly. Even before October 28, when FBI Director Jack Comey announced the discovery of new e-mails potentially related to a probe that has troubled the Clinton campaign, money placed on a Trump victory amounted to almost the same as that bet on his rival, despite her lead in opinion polls.
“You don’t normally see so much placed on the outside candidate but I think the shock of Brexit is fresh in people’s minds,” Mac An Iomaire said.
In an attempt to talk down the potential significance of the recent surge in online betting for Trump, Bloomberg notes that “U.K.‘s June referendum bruised professional pollsters by dealing an unexpected blow to the status quo. Yet another lesson of that vote is that betting flows are not a foolproof indicator, with bookies reporting a surge in bets that the U.K. electorate would choose to remain in the European Union on the morning of the vote. The next day, the “Leave” camp emerged triumphant.” What it ignores, and what we pointed out repeatedly over the summer, is that the vast majority of bets pre-Brexit were for Brexit, however in what some have said was a deliberate attempt to skew the result, a few prominent, large betters were shifting the odds in Remain’s favor. They were wrong.
Indeed, the recent Trump wave is confirmed by various market indicators with the Mexican peso, Credit Suisse AG’s “ultimate market indicator,” weakening more than 3 percent since Comey’s letter, as Trump’s improving prospects jolt the currency.
Still, the probability of a Trump victory implied by offshore bookmakers’ odds are now at 28.5%, according to Convergex market strategist Nicholas Colas. That’s roughly the same as flipping a coin and getting heads twice in a row, and matches estimates by professional polling analysts.
For Paddy Power, which reports third-quarter earnings on Friday, the stakes are higher than most. As we reported previously, on October 18 Paddy Power announced it would start paying out on a Clinton victory, having initially offered a Donald Trump presidency at 100/1. Should Trump win, the outcome may be yet another bankruptcy, only this time it won’t involve a Trump casino.